RBI imposes penalty on 3 banks; worth total Rs 2.49 crore

The RBI has imposed penalties on three banks including Dhanlaxmi Bank and Punjab and Sind Bank for non-compliance with the directives norms of lending activities, KYC, and deposit rates.

RBI imposes penalty on 3 banks; worth total Rs 2.49 crore

The amount imposed on Punjab and Sind Bank is Rs 1 crore while Rs 1.2 crore has been imposed on Dhanlaxmi Bank. The central bank authority has inspected the financial quarter years of Punjab and Sind Bank, which revealed that the public sector bank has violated the norms on Loans and Advances-Statutory and Other Restrictions. 

The respective bank has issued a term loan to a corporation with respect to budgetary resources envisaged for certain projects, without undertaking due diligence on the viability of the projects to ensure serviceship of debt obligations. The termed loan was also sanctioned out of the budgetary resources of Rs 1 crore.

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Dhanlaxmi Bank has also incurred a penalty of Rs 1.20 crore, because of violating regulatory norms on Loans and Advances-Statutory and other Restrictions, Reserve Bank of India [ Know Your Customer KYC] Directions, 2016 and Reserve Bank of India [Interest Rate on Deposits] Directions, 2016. The private sector bank has sanctioned loans to certain borrowers against pledge of gold ornaments and jewelry for non-agricultural purposes which exceed 75% of the value of gold. It also did not obtain PAN or Form 60 for certain term deposit accounts.

It allotted multiple Customer Identification Codes to certain individual customers instead of a Unique Customer Identification Code [ UCIC] to each customer.

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A penalty of Rs 29.5 lakh on ESAF Small Finance Bank for breaching the guidelines on Customer Service in Banks. In FY 22 , the bank allowed certain Basic Savings Bank Deposit [BSBD] account holders to open savings bank deposit account and was unable to close certain savings bank deposit accounts within thirty days from the date of opening of BSBD accounts for such customers.

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